Alaska Poised To Beg for Relief From Crippling Federal Shipping Restrictions
Alaska is a cold state where residents need energy to keep the chill at bay. Fortunately, the state is blessed with natural resources, including abundant oil and natural gas that can help satisfy that need. Unfortunately, as I’ve written before, a nationalistic, century-old law requires that shipping between American ports be conducted only by U.S.–built and –flagged ships. And there aren’t any liquid natural gas tankers that satisfy the requirement. Now Alaska officials are seeking a waiver so they can use their own resources to resolve a growing energy crunch.
Resource-Rich but Starved for Energy
“Alaska is facing an acute energy shortage,” state Sen. Robert Myers (R–Fairbanks) told a State Senate Transportation Committee hearing on his proposed waiver resolution on March 20. “The Alaska Department of Natural Resources has projected shortfalls in the Cook Inlet natural gas supply beginning in the very near future. As such, various utilities are now discussing liquefied natural gas imports to solve the crisis. Alaska is in a unique quandary in which it prides itself on its oil and gas resources yet is unable to utilize its own natural gas from the North Slope gas fields.”
Myers’ statement was meant more for the record than for his fellow lawmakers. Alaskans are well aware of the problem and have been trying to overcome it for years. As it stands, the gas Alaskans use comes not from the abundant supply in the vast North Slope reserves, but from closer to home in the Cook Inlet. Interest in drilling there has waned, though, leaving one company, Hilcorp, as the main producer. Going forward, Hilcorp has warned that it may not be willing or able to supply gas at the same rate as in the past.
That should be fine, given all that North Slope gas. But the North Slope is far from Alaska’s population centers. A new pipeline was approved in 2020 but is still struggling to find investors willing to foot the estimated $44 billion cost. South Korean companies seem interested (the gas will also be shipped overseas), but that still leaves completion of the project years in the future.
But liquid natural gas (LNG) is shipped all over the world. There’s no practical reason the gas can’t be transported by tanker from
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